Issue
Is an administrator appointed to a company liable for wine equalisation tax (WET) when they receive consideration for an assessable dealing with wine which took place before their appointment?
Decision
No. An administrator appointed to a company is not liable for WET when they receive consideration for an assessable dealing with wine which took place before their appointment.
Facts
An administrator is appointed to a company and is registered for GST in this capacity.
The administrator receives payments relating to taxable assessable dealings made by the company prior to their appointment.
Reasons for Decision
The broad aim of the A New Tax System (Wine Equalisation Tax) Act 1999 (the WET Act) is to impose WET on dealings with wine in Australia. Dealings which attract WET are called 'assessable dealings' and WET is imposed unless an exemption applies.
The Assessable Dealings Table in section 5-5 of the WET Act sets out all the assessable dealings that can be subject to WET. Section 5-5(2) specifies that if an entity is registered or required to be registered for GST, and the time of an assessable dealing is on or after 1 July 2000, and no exemption applies, then: • the dealing is a taxable dealing; and • the entity specified in column 3 of the table is the entity liable to WET; and • the WET becomes payable at the time of the dealing as specified in column 4 of the table.
Accordingly, if a company has a taxable assessable dealing with wine and the time of the dealing specified in column 4 of the table of assessable dealings is before the time an administrator was appointed, the liability for WET rests with the company and not with the administrator. This will be so even where the administrator receives payment from a debtor relating to a sale of wine which took place before their appointment.
Amendment History
Date of amendment Part Comment 29 November 2013 Related Public Rulings Updated WET rulings references.
Date of amendment | Part | Comment
29 November 2013 | Related Public Rulings | Updated WET rulings references.